Launching a start-up business is a very difficult process and not having your finances organised can be your downfall. Whether you decide to outsource finances to accountants or keep them in-house, make sure you have a plan and finances are fully prepared.
Roger Hatherall & Co provide financial advice for all start-up businesses. We can support all businesses throughout the Bath area.
Establish An Accounting System
Without an accounting system in place, it is common that you are not prepared to effectively manage your finances once the business is launched. By setting up a system before the business begins, this makes sure all your transactions are recorded immediately, as well as having your initial revenue and expenditure accounted for.
Many start-up businesses will have loans to begin their business or will have assets and equipment they have paid for. Even though this may have taken place before the business began trading, it might be best to keep this within your business finances, helping you set targets to break-even.
Maximise Pay Options
You want your revenue to be as high as possible and regardless of the industry you work in, you want to maximise the payment options you have available. By doing this, it will ensure you can take payments at any time from any clients. You should never be left requiring payments from your customers.
By sending invoices straight away and making sure payments are made as soon as possible, this will keep revenue high. You don t want to miss out on payments simply because you couldnt take a payment from a customer. Maximising the payable systems you have available will always be beneficial.
Dont Overspend On Staff
Most start-up businesses want to keep costs as low as possible so when looking into recruitment, only hire staff for the job roles that are actually needed. There is no point wasting money in areas of your business that are not needed. If you decide to hire staff where you don t need them, your profit could be seriously reduced each month.
Bringing more staff in can be done over time but once your business has been established, this shouldnt be a priority. As you continue to grow, recruiting staff can be much easier and will not have such a negative impact on your cash flow.
Separate Business & Personal Finances
Even as a start-up business, your business and personal finances should never be combined. This will only make accounting and the legal side of your business much more difficult to manage.
Keeping personal and business finances separate makes finances much easier to manage and record. It will also mean you don t end up using business money to make your own purchases and buy things for yourself when it is meant for the business.